Bessent Doubles Down on the Bond Market Nobody Wanted
U.S. Treasury Department announces a doubling of its debt buybacks, causing bond yields to drop. Scott Bessent's team targets long-term bond investors who previously shunned Treasuries. The move aims to provide a buyer for long bonds that lacked demand, effectively becoming the customer the market declined to be. This change in buying strategy won't reduce the pace of bond issuance by the government or influence the Federal Reserve's rate-setting role.
Essentially, Bessent is rearranging the deck chairs on a debt Titanic, hoping the situation improves.
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